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3 U.S. banks reveal their policies on cryptocurrency

The Senate banking committee, which is headed by Senator Sherrod Brown, the CEOs of Bank of America, Citigroup, and Wells Fargo for its annual oversight on Wall Street firms.

Bank of America / Image by: Wikimedia Commons

Mon, 31 May 2021, 13:07 pm UTC

Bank of America, Citigroup, and Wells Fargo have recently revealed their crypto policies before the U.S. Senate banking committee. Though lagging behind Goldman Sachs and Morgan Stanley, which are already offering investments with exposure to Bitcoin and other cryptos, the three banks are in already different stages of offering crypto-related services to their clientele.

“Currently, we do not lend against cryptocurrencies and do not bank companies whose primary business is cryptocurrency or the facilitation of cryptocurrency trading and investment,” Bank of America CEO Brian Moynihan told the Senate banking committee last week, according to Bitcoin.com. Headed by Senator Sherrod Brown, the committee summoned the three CEOs of the investment banks for its annual oversight on Wall Street firms.

Moynihan added that BofA is keeping its distance from cryptos as it continues to “evaluate the opportunities, risks and client demand for products and services related to cryptocurrency.” While it holds more than 60 blockchain-related patents, he said that “we still have not found a use case at scale.”

“Before we engage with cryptocurrencies, we see it as our responsibility to ensure we have clear governance and controls in place,” Citigroup CEO Jane Fraser said.

Fraser explained that Citigroup is taking a “measured approach” to crypto. The bank wants “to understand changes in the digital asset space and the use of distributed ledger technology, including demand and interest by our clients, regulatory developments and technology advancements.”

“We continue to closely and actively follow developments around cryptocurrencies, which have emerged as alternative investment products, though their status as a currency and mechanism of payment remains fluid,” Wells Fargo CEO Charles Scharf said.

Wells Fargo Investment Institute President Darrell Cronk said last week that the wealth and investment management division plans to offer an actively managed crypto strategy to its wealthy clients, which could be launched by mid-June. “We think the cryptocurrency space has just kind of hit an evolution and maturation of its development that allows it now to be a viable investable asset,” he said.

However, the service will only be offered to a select group of clients. “WFII believes that crypto-currencies have gained stability and viability as assets, but the risks lead us to favor investment exposure only for qualified investors, and even then through professionally managed funds,” the wealth management division wrote in a report.

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